Colorado Contractor License Search
What You Should Know about Hiring a Contractor in Colorado
Over 65,000 contractors are licensed to operate in Colorado by the Department of Regulatory Agencies (DORA), the state's umbrella regulatory agency. Choosing a licensed contractor gives you peace of mind knowing an appropriately qualified and accredited expert will handle your project and complete it successfully. In most cases, professional contractors are also insured and bonded to protect you from any financial liability resulting from injuries to any workers on the job site or damage to your property. Furthermore, checking your contractor's license and other credentials can help you avoid the following types of contractors:
- Dishonest contractors who might steal your money
- Unreliable contractors who pose a threat to the safety of your family
- Unlicensed contractors who are unable to finish your project according to applicable industry standards
In Colorado, most trades are licensed at the state level. As such, before hiring a contractor in Colorado, you should consider the following points:
- Who Is a Contractor in Colorado?
- How to Search for a Contractor's License in Colorado
- Penalty for Hiring a Contractor Without a License in Colorado
- How Much Does a Contractor Charge in Colorado?
- Tips for Hiring a Contractor in Colorado
- Is Your Contractor Insured and Bonded as Required by Colorado Statutes?
- Top Contractor Scams in Colorado
- How to Report Fraudulent Colorado Contractors
Who Is a Contractor in Colorado?
Contractors are individuals and businesses that offer services based on a written or oral agreement. While general contractors in Colorado do not obtain licenses from one statewide agency, the Department of Regulatory Agencies (DORA), the state's umbrella regulatory agency, sets statewide regulations for licensing electricians and plumbers.
To perform general contracting work in Colorado cities, contractors must obtain a local license from municipal authorities in each city.
- General Contractor License: while different agencies issue general contractor licenses depending on which Colorado city you apply in, the process is similar. For example, in Denver, Colorado's most populous city, general contractors who wish to provide services in the city must have a license from the Denver Community Planning and Development office. A range of contractor licenses is available through this agency, including the following:
- Fire Protection
- Construction licenses are further classified as follows:
- Class A General Contractor: for the construction, addition, alteration, repair, or demolition of any building or structure.
- Class B Building Contractor: for International Building Code's low-rise buildings and structures that need alterations, additions, repairs, demolition, or construction.
- Class C Residential Contractor: for the building, demolition, repair, or alteration of single-family and multi-family homes.
- Specialty Contractors: these contractors can provide particular construction and home improvement services, including plumbing, HVAC (heating, cooling, ventilation, and air conditioning) work, electrical work, painting, masonry work, and roofing. Specialty contractors, often called "subcontractors," are frequently chosen by a general contractor to carry out a particular duty or offer a particular service associated with a project. Nevertheless, for projects involving a single task, you can work directly with a specialty contractor.
How to Search for a Contractor's License in Colorado
You can find out if your Colorado contractor has a current license by using the Uhire professional licensing search, which offers a thorough search option for all types of contractors. You can also utilize the license lookup tool the Department of Regulatory Agencies provides.
Penalty for Hiring a Contractor Without a License in Colorado
Providing unlicensed plumbing or electrical services in Colorado is a Class 2 misdemeanor that carries a 3 to 12-month jail sentence and a $250 to $1,000 fine for a first conviction. A second offense is a Class 6 felony carrying a penalty of $1,000 to $10,000 in fines or 12 to 18 months in prison.
On the side of the customer, there are several disadvantages to hiring an unlicensed contractor:
- When engaging an unlicensed contractor, you risk receiving poor-quality services from unqualified and inexperienced individuals.
- Such contractors are likely to be uninsured and unbonded. This means that you could be held accountable for any accidents and property damage that may happen during the project.
- Contractors without licenses cannot obtain the necessary permits from municipal building agencies. Building code breaches can result in financial penalties and decrease property value if projects are finished without all essential permits.
How Much Does a Contractor Charge in Colorado?
The average hourly rate for specialty contractors ranges from $50 to $100. The complexity and labor requirements of projects influence their overall costs.
The table below lists typical hourly rates for Colorado's most demanded specialized contractors; keep in mind that actual pricing may vary depending on your region and the contractor's reputation:
Typically, more than one specialized contractor is needed for a residential or commercial project. Thus, it is smart to employ a general contractor to oversee the entire project and save you the time, money, and stress of managing various professionals. Keep in mind that the cost of the project as a whole often determines the general contractor's fees. These fees are often computed using one of the following approaches and vary from 10 to 20 percent of the project's overall cost:
- Fixed Price Method: in this case, the contractor consents to complete the project in exchange for a set payment. This method is ideal for projects with a defined scope and a predetermined deadline.
- Cost Plus Fee Method: in this case, the contractor adds a markup to all the services provided in addition to the actual work completed on the project. This method is preferable for large projects with unclear deadlines. However, to prevent prices from skyrocketing, it is advisable to agree on a specific maximum price.
In Colorado, you can expect to pay between $100 and $400 per square foot for building and home remodeling projects. Total costs are influenced by variables like the following:
- Costs of permits, labor, and additional expenses
- Payouts to contractors
- The urgency of the required services
- The cost of necessary supplies
- The project site's accessibility and conditions
- The project's nature and scope
- The standing and qualifications of the contractors engaged
- Your location
Tips for Hiring a Contractor in Colorado
It is important to ensure that the contractors you hire are up to the task given the amount of money that the construction, improvement, installation, maintenance, and repair of real estate and its fixtures normally involve. Understanding the project's scope and identifying the types of contractors required are the initial steps in achieving this. Consequently, before employing any contractors in Colorado, you should consider the following advice:
- Employ only state-licensed contractors at all times. You can check the status of your contractor's license online.
- Request and compare quotes from up to three contractors for your projects.
- Request and examine references from each bidder.
- Before any work begins, insist on receiving a written contract that details all the project's expectations and agreements. Make sure you've read and understood the contract before signing.
- Verify the contractor's (and all connected subcontractors') insurance and bonding coverage.
- Never pay the entire project cost upfront, and never pay more than $1,000 (or 10% of the project's total cost, whichever is less) in advance for home improvement projects.
- Before making the final payment, ensure the job has been completed adequately.
- Avoid paying in cash.
- Keep copies of all project-related paperwork, such as invoices, warranties, and contracts.
Is Your Contractor Insured and Bonded as Required by Colorado Statutes?
In Colorado, all independent contractors are required to have workers' compensation insurance for their staff. Even if a contractor does not employ anyone, they are still required to carry workers' compensation insurance unless they specifically opt out by submitting the proper paperwork.
Checking whether your potential contractors are properly insured and bonded will protect you financially and legally from unanticipated events like bodily harm, unintentional property damage, and contractor errors that may arise during your project. Keep in mind that bonding and insurance provide different kinds of protection. The project owner and contractor are often both protected by insurance, which shields the former from out-of-pocket expenses related to mishaps and injuries. Bonds, on the other hand, are primarily intended to safeguard project owners and guarantee that they are not responsible for any damage brought on by the contractor's failure to complete the work as agreed.
Therefore, before hiring a potential contractor, always demand documentation of their bonding and insurance. Ensure their general liability insurance covers the size of your project as well. You can do this by requesting a copy of their insurance (and bond) certificate and verifying it by contacting the issuer. For more information on the insurance and bond requirements for Colorado contractors, you can call the Colorado Division of Insurance at (303) 894-7499.
Top Contractor Scams in Colorado
Colorado has the highest reported rate of contractor fraud in the US. Every year, 6.1 out of every 10,000 homeowners become victims of these frauds, more than three times the US average.
Some methods frequently used by dishonest contractors to deceive homeowners in Colorado include the following:
- Going door-to-door to solicit work at reduced rates
- Providing free house inspections and then "finding" issues that require immediate attention
- Using fear and high-pressure sales tactics to convince homeowners to sign up for services or pay too much for them without doing their research
- Wildly exaggerating the cost of supplies needed for the project, requesting full or significant upfront payments, and insisting on cash payments.
- Minimizing the importance of written agreements
- Presenting contracts with shady terms or with empty spots that can be filled in afterward
You can avoid being scammed by doing the following before hiring contractors:
- Be wary of contractor offers you didn't ask for.
- Always work with contractors who are duly licensed.
- Obtain and compare estimates from various contractors for your project.
- Always conduct thorough research on potential contractors. Ensure they are sufficiently insured and bonded, ask for references, and check their reputation.
- Demand written agreements and carefully read them before signing.
- Never put your signature on anything you don't fully understand.
- Ask your general contractor and all associated subcontractors for lien waivers.
- Don't give more than $1,000 (or 10% of the total project cost, whichever is less) as a down payment.
- Avoid paying with cash.
How to Report Fraudulent Colorado Contractors
Depending on the circumstances, there are a number of agencies in Colorado through which you can report contractor fraud and pursue legal action against dishonest contractors.
Colorado Division of Professions and Occupations
You can file a complaint with the Division of Professions and Occupations regarding electrical and plumbing contractors working without a license, without sufficient workers' compensation insurance, or not paying the prevailing wage (you can also file issues involving licensed contractors with this organization).
Colorado Attorney General's Office
It is appropriate to report any instances of unfinished work, exorbitant fees, and dishonest business activities resulting in monetary loss or theft to the Colorado Attorney General's Office. You can also contact the district attorney's office in your area for these matters.
Small Claims Court
You may consider bringing a small claims case against a contractor if they have broken the terms of the written agreement (small claims courts do not allow cases for more than $7,500). Before doing this, informing the DORA and your neighborhood district attorney's office of the problem is advisable. Small claims cases under $500 are filed for a charge of $31, and those over $500 are filed for a charge of $55.
Better Business Bureau (BBB)
As an alternative, you could report a dishonest contractor to the Better Business Bureau chapter in your area. The BBB encourages locals to report scams, complain about contractors, share their experiences with businesses, and warn others about deceptive advertisements.
The Police Department
It is recommended to first report to your local police department if a contractor physically threatens or steals from you.